(Reuters) - Canadian fertilizer company Agrium Inc AGU.TO AGU.N reported on Tuesday a sharply lower third-quarter profit and a disappointing forecast for the current fourth quarter.
Uncertainty in fertilizer markets, combined with a late North America growing season caused many buyers to delay crop nutrient purchases, said Chief Executive Mike Wilson.
Potash prices have slipped since mid-summer, when the biggest global producer Uralkali OAO (URKA.MM) quit its export partnership, Belarusian Potash Company (BPC), with Belaruskali and said it would seek to maximize sales volumes.
BPC was one of the world’s two biggest potash trading companies, along with North America’s Canpotex Ltd, owned by Mosaic Co (MOS.N), Potash Corp of Saskatchewan Inc POT.TO and Agrium.
Agrium’s U.S.-listed shares eased 0.1 percent after normal trading hours. They finished on Tuesday at $87.27.
The Calgary, Alberta-based company forecast fourth-quarter earnings of 80 cents to $1.25 per share, well below analysts’ expectations of $1.51.
Outages at Agrium’s Redwater, Alberta, and Carseland, Alberta, nitrogen facilities reduced product availability in the third quarter and will also affect fourth-quarter sales volumes, Wilson said, adding that they will reduce fourth-quarter earnings by approximately 20 cents per share.
Net earnings for the third quarter fell 41 percent to $76 million, or 52 cents per share, compared with $129 million, or 80 cents per share, a year ago.
Adjusted earnings per share were $73 million, or 50 cents per share.
On that basis, analysts on average expected Agrium to earn 57 cents a share in the third quarter, according to Thomson Reuters I/B/E/S.
Revenue for the company rose to $2.87 billion from $2.83 billion, exceeding expectations for $2.82 billion.
Wholesale sales of nitrogen, potash and phosphate decreased by 24 percent to $752 million due to lower realized sales prices across all products and the plant outages, Agrium said.
Agrium warned in September that its potash volumes were expected to be about 30 percent lower than normal in the third quarter.
Retail sales of products like fertilizer, chemicals and seed to farmers increased by 15 percent to $2.1 billion.
Reporting by Rod Nickel in Winnipeg, Manitoba and Soham Chatterjee in Bangalore